Neighbourhood inequality spillover effects of gentrification

Previous research has considered how gentrification may alter the racial composition, income composition and income segregation within a neighbourhood. An increase in income segregation at the neighbourhood level may be evidenced by a reduction in income inequality, which may harm low†income households. We examine how the influence of gentrification, with respect to changes in income inequality at the neighbourhood level over time, may spill over into surrounding neighbourhoods as lower†income households' location choices change. We use data from the 30 largest Core Based Statistical Areas in the US from 2000–2010 and find that areas bordering newly gentrified neighbourhoods experience an increase in income inequality (potentially benefiting low†income households). This effect appears to be concentrated in relatively smaller CBSAs, where lower†income households may have less mobility, and in surrounding neighbourhoods that are themselves relatively lower†income.